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The California Association of REALTORS® formally apologizes for its past discriminatory policies, including Proposition 14, a successful 1960s ballot initiative that overturned the State of California’s first fair housing law. C.A.R.’s leaders issued the apology in a press release and in a live press conference.

Regrettably, the California Real Estate Association (CREA), now known as C.A.R., once played a leading role in segregation and exclusionary practices in housing. California communities still grapple with wealth and homeownership inequities. For decades, CREA promoted policies that encouraged discrimination and the idea that neighborhood integration would negatively impact property values. The Association endorsed racial zoning, “redlining” and racially restrictive covenants.  

“The Association was wrong. We not only apologize for those actions, we strongly condemn them, and we will continue working to address the legacy of these discriminatory policies and practices,” said C.A.R. President Otto Catrina.

CREA was behind Article 34, a law passed in the 1950s that remains in place that makes it very difficult to build affordable housing in California. The Association also excluded women and people of color from membership.

In the 1960s, California’s first fair housing law, the Rumford Fair Housing Act, was passed. CREA actively encouraged its members to support Proposition 14, a law that overturned the Rumford Act and modified California’s constitution so that the state could not prohibit private property owners from engaging in discrimination. The U.S. Supreme Court overturned the proposition as unconstitutional.

In the years since the passage of the federal Fair Housing Act of 1968, the California Fair Employment and Housing Act and other fair housing laws, C.A.R. has prioritized understanding and addressing the unique homeownership barriers impacting communities of color and other historically excluded communities. 

“We have continued to unpack our difficult and sometimes obscure history of opposing fair housing laws, promoting segregation and racial exclusion prior to the Fair Housing Act of 1968. As an organization that deeply values inclusion, we can’t change the actions of the past, but we are taking bold action now to help build a more equitable and just future,” said Catrina.

For instance, C.A.R. recently sponsored a law requiring periodic implicit bias training for all real estate salespersons. Additionally, C.A.R. helped shape a new law that strengthens consumer protection in instances of appraisal bias.

Currently, C.A.R. is working to address the legacy of discriminatory policies in a variety of ways. These include:

● Offering a closing cost grant for members of underserved communities.

● Donating to the Black Wealth Builders Fund, a down payment assistance program for Black home buyers in the Bay Area.

● Partnering with and sponsoring the work of nonprofit organizations that support greater homeownership for members of underserved communities.

● Sponsoring and supporting a variety of policies that address supply and affordability challenges for communities of color. 

● Co-sponsoring a bill that would overturn Article 34, a law California REALTORS® helped pass in the 1950s that makes it much harder for California communities to build affordable housing.

● Supporting a law that provides a system for redacting restrictive covenants in property records. 

“The Silicon Valley Association of REALTORS® (SILVAR) has always promoted homeownership for all. We have promoted C.A.R.’s Fairhaven simulation, an innovative online simulation training, where agents walk in the shoes of a homebuyer facing discrimination. The training provides customized feedback that agents can apply to daily business interactions,” said Brett Caviness, president of SILVAR. “We have also introduced a number of diversity, equity and inclusion programs to our members, so all are aware that discrimination is not allowed in any facet of real estate.”

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The National Association of  REALTORS® (NAR) Board of Directors today strengthened REALTORS®’ commitment to upholding fair housing ideals by approving a series of recommendations from NAR’s Professional Standards Committee that extend the application of Article 10 of the Code of Ethics to discriminatory speech and conduct outside of members’ real estate practices.

Article 10 prohibits REALTORS® from discriminating on the basis of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity in the provision of professional services and in employment practices. The Board approved a new Standard of Practice under the Article, 10-5, that states, “REALTORS® must not use harassing speech, hate speech, epithets, or slurs” against members of those protected classes.

The Board also approved a change to professional standards policy, expanding the Code of Ethics’ applicability to all of a REALTOR®’s activities, and added guidance to the Code of Ethics and Arbitration Manual to help professional standards hearing panels apply the new standard.

Finally, Directors approved a revision to the NAR Bylaws, expanding the definition of “public trust” to include all discrimination against the protected classes under Article 10 along with all fraud. All REALTOR® Associations are required to share with the state real estate licensing authority final ethics decisions holding REALTORS® in violation of the Code of Ethics in instances involving real estate-related activities and transactions where there is reason to believe the public trust may have been violated.

These changes are effective immediately, though the changes cannot be applied to speech or conduct that occurred before today. NAR has produced training and resource materials to assist leaders with understanding and implementing the changes and will be rolling those out in the coming weeks.

READ MORE HERE, INCLUDING FAQs

The United States Supreme Court recently held that a private or public entity can be sued for discrimination even if there was no intent by that entity to discriminate, upholding the validity of disparate impact claims in fair housing issues.

The ruling touches on the concept of “disparate impact” which, under the Fair Housing Act, states that any policy or practice that creates a disproportionate “adverse impact” on any group based on race, national origin, color, religion, sex, familial status, or disability may be considered discriminatory or illegal. Opponents have maintained there needs to be intent for a discrimination suit to be valid, but all federal courts of appeal have interpreted the law to mean that an entity can get sued for housing discrimination if its actions have a disparate impact on a protected class, regardless of intent.

In its ruling, however, the Court clarified that just because an action has a disparate impact, it does not mean it is discriminatory. The plaintiff must point to a specific policy that the defendant had and show that the policy had a negative impact on the plaintiff’s protected class. The defendant can avoid liability if it can prove that the policy is necessary to achieve a legitimate business interest. The plaintiff also must be able to show there is an alternative business practice with a less discriminatory effect that would equally serve the defendant’s legitimate business interest in order for the plaintiff’s disparate impact claim to be valid.

As an example, a REALTOR® having a policy of only selling homes to members of their religious institution could face a disparate impact claim if a member of a different faith claims that this policy causes members of the another faith to miss the best homes. In the same light, when considering the adoption of any policy, real estate professionals operating as property managers or housing developers should make sure the policy will not have an unintended disparate impact on a protected class.

April 2014 marks the 46th anniversary of the passage of the 1968 landmark U.S. Fair Housing Act. Title VII of the Civil Right Act of 1968 strives to ensure equal housing opportunity for all and prohibits housing discrimination based on race, color, national origin, religion, sex, disability, and family status.

“Fair Housing Month is an opportunity to recommit to the principle that fair housing is an essential part of everything we do. REALTORS® play a vital role in ensuring fair housing for all and strive to make home ownership accessible to everyone,” says David Tonna, president of the Silicon Valley Association of REALTORS®.

Article 10 of the National Association of REALTORS® Code of Ethics provides that, “REALTORS® shall not deny equal professional services to any person for reasons of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. REALTORS® shall not be parties to any plan or agreement to discriminate against a person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. REALTORS®, in their real estate employment practices, shall not discriminate against any person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity.”

Home sellers, home seekers, and real estate professionals all have rights and responsibilities under the Fair Housing law:
• Home sellers or landlords are required under the law not to discriminate in the sale, rental and financing of property on the basis of race, color, religion, sex, handicap, familial status, or national origin. They cannot instruct the licensed broker or salesperson acting as their agent to convey for them any limitations in the sale or rental because the real estate professional is also bound by law not to discriminate. A home seller or landlord cannot establish discriminatory terms or conditions in the purchase or rental; deny that housing is available, or advertise that the property is available only to persons of a certain race, color, religion, sex, handicap, familial status, or national origin.

• Home seekers have the right to expect that housing will be available to them without discrimination or other limitations based on race, color, religion, sex, handicap, familial status, or national origin. This includes the right to expect housing in their price range made available to them without discrimination; equal professional service; the opportunity to consider a broad range of housing choices; no discriminatory limitations on communities or locations of housing; no discrimination in the financing, appraising, or insuring of housing; reasonable accommodations in rules, practices and procedures for persons with disabilities; non-discriminatory terms and conditions for the sale, rental, financing, or insuring of a dwelling; to be free from harassment or intimidation for exercising their fair housing rights.

• Agents in a real estate transaction are prohibited by law from discriminating on the basis of race, color, religion, sex, handicap, familial status, or national origin. A request from the home seller or landlord to act in a discriminatory manner in the sale, lease or rental cannot legally be fulfilled by the real estate professional.

Complaints alleging discrimination in housing may be filed with the nearest HUD office, or by contacting them at http://www.hud.gov.

In recognition of Fair Housing Month in April, REALTORS® continue to reaffirm their commitment to equal access to housing and home ownership. Signed into law in 1968 and amended in 1988, the Fair Housing Act prohibits housing discrimination on the basis of race, color, religion, sex, disability, familial status and national origin.

“Fair housing is not an option; it’s the law,” said Gene Lentz, president of the Silicon Valley Association of REALTORS® . “REALTORS®  are on the ‘front lines,’ working with buyers and sellers to see that they enjoy the benefits of a housing market free from discrimination.”

To mark Fair Housing Month, SILVAR on April 8 offered the National Association of REALTORS® ’ At Home with Diversity certification course for all REALTORS®  and affiliates. The course teaches real estate professionals how to increase their sensitivity and adaptability to future market trends and how to transact business across cultures, generations and other differences. More than 25,000 REALTORS®  have completed the program.

“People have a right to live wherever they can afford to live,” Lentz said. “Fair housing means opening those doors for everyone in this country whose goal it is to own a home.”

Lentz indicated Santa Clara County is among the most diverse counties in the U.S. The 2010 U.S. Census figures show the county grew by nearly 6 percent in the past decade. Much of the growth in population is attributed to a gain of about 140,000 Asians and 76,000 Latinos, yet minority home ownership comprises a very low percentage of the population.

“Diverse neighborhoods and schools strengthen communities, and minority population growth is vital to sustaining housing markets,” said Lentz.

Lentz said the home seller, the prospective home buyer and the real estate professional all have rights and responsibilities under the law.

A home seller or landlord is required under the law not to discriminate in the sale, rental and financing of property on the basis of race, color, religion, sex, handicap, familial status, or national origin. They cannot instruct their agent to convey any limitations in the sale or rental because the real estate professional is also bound by law not to discriminate.

Buyers or renters have the right to expect that housing will be available without discrimination, including  the right to expect housing in their  price range made available without discrimination; equal professional service; the opportunity to consider a broad range of housing choices; no discriminatory limitations on communities or locations of housing; no discrimination in the financing, appraising, or insuring of housing; reasonable accommodations in rules, practices and procedures for persons with disabilities; non-discriminatory terms and conditions for the sale, rental, financing, or insuring of a dwelling; and freedom from harassment or intimidation for exercising their fair housing rights.

People who believe they have experienced discrimination may file a complaint with the Department of Fair Employment and Housing (DFEH). Complaints must be filed within one year of the alleged discrimination.

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